Legality, distilled — Legislation would align Alaska distillery, craft brewing rules

Photo courtesy of Elaine Howell. The Chilkoot Distillery in Haines.

Photo courtesy of Elaine Howell. The Chilkoot Distillery in Haines.

By Bill Howell, for the Redoubt Reporter

What’s the biggest difference between craft brewing and craft distilling? The law.

About 2.1 million Americans make their own beer at home. I’m one of them. Federal law allows an adult to brew up to 100 gallons of beer a year and up to 200 gallons per household, with the only restriction being that the beer is not sold commercially. Last year the last two holdout states, Mississippi and Alabama, bowed to common sense and legalized it, as well. Most of the thousands of commercial craft brewers in the U.S. today started out as homebrewers.

However, if I were to take any amount of the beer I produce at home and distill it, that’s a violation of federal law. While I’m sure there are plenty of “home distillers” out there — after all, Americans have been distilling in defiance of the federal government since at least the Whisky Rebellion in 1791 — they have to keep a very low profile, unlike homebrewers. So you don’t have a bunch of eager hobbyists looking to make the jump to the commercial side of distilling, like you have in the world of craft beer.

Given this handicap, it’s hardly surprising that the growth of craft distilling has lagged behind that of craft brewing. However, things are gradually beginning to change, even here in Alaska. There are now five craft distilleries in Alaska — Ursa Major Distilling in Fairbanks, Alaska Distillery in Wasilla, Bare Distillery in Anchorage, Port Chilkoot Distillery in Haines, and High Mark Distillery in Sterling, right here on the Kenai Peninsula.

In addition to all the other challenges facing small businesses in Alaska, these five distilleries face an additional hurdle — they are legally prohibited from selling their products directly to the customer. It seems that Alaska law, at least as interpreted by the state’s Alcoholic Beverage Control Board, denies distilleries the right enjoyed by breweries and wineries to offer samples to their customers and to sell directly to them. As the law stood, they would be required to sell only to distributors, which would then sell their products to liquor stores, restaurants and bars. Since direct sales to customers are a key revenue stream for small, artisanal producers like these, this was a real problem.

The good news is that the distilleries were able to get together and get some action from the Alaska Legislature last session. House Bill 309, introduced by Rep. Chris Tuck, of Anchorage, allows distilleries to offer free samples of spirits, sell up to 3 ounces for consumption on premises and sell up to a gallon of spirits for off-premises consumption.

These changes to current state law mean small craft distilleries will have a fair chance at commercial success. The bill passed this session by wide margins (20 to 0 in the Senate), and is awaiting Gov. Sean Parnell’s signature to become law.

Of course, being the Alaska state government, this entire process has taken so long that our craft distilleries are pretty much guaranteed to lose out on a big chunk of their potential tourist season retail business this year, but what else can we expect, right? After all, it’s the state of Alaska at work.

Since we have a distillery right here on the peninsula, this is all of obvious great local interest. In December 2012, I wrote about the opening of High Mark Distillery in Sterling. Once this law is signed by the governor, it will be the signal for a significant expansion of their effort to attract summer tourist retail sales.

Over Memorial Day weekend I happened to be in Haines, so I stopped by another craft distillery impacted by HB 309, the Chilkoot Distillery. It’s housed in the former bakery for Fort Steward, a restored historic building dating from 1903. Owners Sean Copeland and Heather Shade showed me around. I could see immediately how such a place could be a real tourist attraction. It’s located right in the historic area of Haines, next to arguably the best place to dine in town, the Fireweed Restaurant. The building itself is very interesting, with plenty of exposed beams and 100-plus-year-old wood to show off.

The distillery uses a neat little Vendome mash cooker and column still, which were both fascinating to look at, at least for an engineer like me. Sean and Heather were both gracious hosts, taking time to answer my tentative knock on their door on a Saturday morning (even though they are technically only open Monday through Friday) and show me around and answer my questions.

Chilkoot currently makes three spirits — vodka, gin and moonshine. If all goes well, you can look for their first barrel-aged whiskey to be released in fall 2015. If you find yourself in Haines, I certainly recommend stopping by.

With five craft distilleries and counting, the future of artisanal spirits in Alaska looks very bright indeed.

Until next month, Cheers!

Bill Howell is a homebrewer, teaches a beer appreciation class at Kenai Peninsula College’s Kenai River Campus and was named the 2010 Beerdrinker of the Year by Wynkoop Brewing Company in Denver. He and his wife, Elaine, have authored “Beer on the Last Frontier: The Craft Breweries of Alaska,” available via Amazon.

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